In 1977 Congress enacted the Fair Debt Collection Practices Act in response to the widespread concern regarding the "abusive, deceptive, and unfair debt collection practices by many debt collectors." 15 U.S.C. § 1692(a). The stated purpose of the Act is "to eliminate abusive debt collection practices by debt collectors, to insure that those debt collectors who refrain from using abusive debt collection practices are not competitively disadvantaged, and to promote consistent State action to protect consumers against debt collection abuses." 15 U.S.C. § 1692(e).

To that end, Congress intended to prohibit all debt collection procedures which could be characterized as unfair, including communications with acquaintances of the consumer, telephone calls at unreasonable hours, abusive statements, threats of violence, and false or misleading representations. See Jenkins v. Heintz, 25 F.3d 536, 538 (7th Cir. 1994), aff'd sub nom. Heintz v. Jenkins, 514 U.S. 291, 115 S. Ct. 1489, 131 L. Ed. 2d 395 (1995). Liability under the Act, however, is possible only if the defendant is a "debt collector" as defined under the Act.

The Act defines a "debt collector" as "any person who uses any instrumentality of interstate commerce or the mails in any business the principal purpose of which is the collection of any debts, or who regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another." 15 U.S.C. § 1692a(6). Significantly, the definition of "debt collector" does not include a person collecting its own debts or the debts of an entity which is "related by common ownership or affiliated by corporate control." 15 U.S.C. § 1692a(6); § 1692a(6)(B). Section 1692(6)(B), the so-called "common ownership" exception, applies only if the subsidiary or affiliate acting as the debt collector does so solely for the entity to which it is related or affiliated and its principal business is not debt collection Id.

Relying on these two exceptions, defendant contends that it is not a "debt collector" within the meaning of the Act because it only collects debts due itself or its corporate affiliates. Plaintiff counters that defendant is subject to the Act because it attempted to collect debts owed itself through deceptive means, i.e., issuing a credit card in the name of Lord & Taylor and then using the name of May Department Stores to give the impression that a third party was attempting to collect the debt.

The Act defines a creditor as "any person who offers or extends credit creating a debt or to whom a debt is owed, but such term does not include any person to the extent he receives an assignment or transfer of a debt in default solely for the purpose of facilitating collection of such debt for another." 15 U.S.C. § 1692a(4). As previously noted, May National Bank of Ohio routinely sells the Lord & Taylor credit card account receivables to May which, in turn, sells them to Lord & Taylor Finance, Inc., another wholly-owned subsidiary of defendant May. While May is responsible for servicing and collecting the Lord & Taylor credit card accounts, the record is admittedly unclear regarding to whom the debt was owed when May commenced its collection efforts. As discussed below, however, this unresolved issue is not enough for plaintiffs to withstand defendant's motion for summary judgment.

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